Good morning. Today we are looking at the ongoing troop build up in eastern Europe and how Miami became the most important city in America. But first, warnings of slowing growth from Facebook and Spotify.
Investors wiped almost $200bn from the market valuation of Facebook-owner Meta as the company warned that its users were spending more time on newer rivals such as Chinese-owned TikTok.
Shares in the company plummeted more than 20 per cent in after-hours trading, putting them on course for their worst day since the social media group listed in 2012. The share price fall has unsettled investors in Asia and Asia today.
Meta blamed “increasing competition” for the disappointing results and Apple’s recent privacy changes.
“There’s a clear trend where less data is available to deliver personalised ads,” Meta chief executive Mark Zuckerberg said on a call with analysts after the results were released.
The social media group is also investing heavily in the metaverse which it hopes will fuel future growth but spending on the new project ate into fourth-quarter profits.
Meta was not the only technology company to warn growth is slowing. Spotify, which has been embroiled in a controversy surrounding Joe Rogan, said subscriber growth would slow significantly in the current quarter. The gloomy outlook sent shares down as much as 23 per cent in after-hours trading. Daniel Ek, Spotify chief executive, said it was “too early to know” whether the backlash over the popular podcaster would cost the streaming service subscribers.
Shares in PayPal also tumbled after the US payments group slashed its growth forecasts. It said many of the new accounts opened during the pandemic had failed to generate any meaningful business.
Opinion: Rogan’s thoughtful response to public criticism illustrates why his show has become the platform’s most popular, writes Jemima Kelly.
Thanks for reading FirstFT Americas. What do you think of today’s newsletter? Tell me by emailing firstft@ft.com — Gordon
Five more stories in the news
1. US sends 2,000 extra troops to Europe US President Joe Biden has ordered the additional deployment to strengthen Nato’s response to a possible Russian invasion of Ukraine. Washington also said it would redeploy roughly 1,000 troops from Germany to Romania. Biden and Volodymyr Zelensky, Ukraine’s president, are trying to play down any sense of division.
Too hot to handle? Hedge funds are scooping up Russian and Ukrainian assets after declines since last autumn, while institutional investors are staying clear.
Go deeper: What is behind the crisis and how might a conflict play out? Here are five books about Vladimir Putin, Russia and former Soviet republics.
The FT View: There are limits to western sanctions on Russia. The US and Europe must be prepared to take their share of economic pain.
2. US special forces carry out anti-terror attack in north-west Syria US special forces carried out what appeared to be one of the biggest assaults of its type in north-west Syria overnight. The Pentagon did not say who, or what, was targeted in the raid but a human rights group said casualties included two children and a woman.
3. CNN chief Jeff Zucker resigns The longtime head of the network and a towering figure in US television news has resigned after failing to disclose a romantic relationship with a colleague. The affair came to light during an investigation into claims against former host Chris Cuomo.
4. Opec and allies agree oil production increase Opec+ agreed yesterday to boost its production quota by another 400,000 barrels a day in March, its eighth consecutive monthly increase, even as data showed some producer countries were struggling to keep pace with the rises.
5. Kim Jong Un has ‘withered away’ The North Korean leader has “suffered” on behalf of his people during chronic food shortages, according to a state television documentary that has intensified speculation about his health and the future of the regime.
Coronavirus digest
New Zealand is to gradually reopen its borders to citizens, workers and international travellers as support for prime minister Jacinda Ardern drops. Switzerland, meanwhile, is considering ending all pandemic restrictions on public life on February 16.
Turkey’s official inflation rate has reached 48.7 per cent, the highest level since Recep Tayyip Erdogan’s ruling party came to power almost two decades ago.
An Omicron coronavirus sub-variant named BA.2 has become the dominant strain in Denmark, India and South Africa. Here’s what we know about it.
Megan Greene, senior fellow at Harvard Kennedy School and chief economist at Kroll, urges the Federal Reserve to be cautious as it prepares to tighten monetary policy. The US workforce is largely in cyclical, not structural, change, she says. Are you thinking about changing jobs? Take our latest poll.
The day ahead
Monetary policy The Bank of England is expected to announce a rise in interest rates from 0.25 per cent to 0.5 per cent, the first back-to-back increase since 2004. Economists expect the ECB to keep interest rates negative but investors are beginning to bet on a rise this year.
Amazon earnings Analysts think the ecommerce group may have ended 2021 with its best quarter ever. It is forecast to have generated more than $137bn in revenue in the three months ended December 31. Also reporting today are drugmaker Merck, oil producer ConocoPhillips, private equity firm Carlyle Group and carmaker Ford.
US jobless claims New applications for employment benefits rose by 245,000 in the week ended January 29, economists predict, compared with 260,000 a week earlier.
US Senate hearings Lisa Cook, a professor of economics at Michigan State University, Philip Jefferson, a former research economist for the Fed’s board, and Sarah Bloom Raskin, a former deputy secretary of the US Treasury during the Obama administration, are set to be grilled by the Senate Banking committee. The three are expected to face a rocky ride during the confirmation process.
Joe Biden visits New York City The president is meeting Eric Adams, the city’s newly elected mayor. He hopes that Adams will help him reassure anxious voters the Democrats can be trusted to address a rise in violent crime across big cities that has been exacerbated by the pandemic.
What else we’re reading
How Miami became the most important city in America The “Miami Moment” really took off when Covid hit. In the 12 months from July 1 2020, far more Americans moved to Florida than any other state — 220,890 of them. But what’s happening in Miami is more than a migration of people. It’s also a migration of money.
Satya Nadella: ‘Being great at game building gives us permission to build the next internet’ In his first interview since the Activision deal was announced, the Microsoft chief executive explains the thinking behind the $75bn video game maker acquisition. This is the first in a new series of monthly ‘Tech Exchange’ interviews.
Beijing Olympics: a front line in the US-China cold war Multinational sponsors have been accused of ignoring the plight of more than 1mn Uyghur Muslims detained in China by backing the Beijing Winter Olympics. On the eve of the games, FT reporters explore what a tense US-China relationship means for corporate America.
Polish your storytelling skills to win a pay rise Here are some simple tips for improving your odds to secure a rise in pay and ensure the process goes smoothly. By borrowing from behavioural science you are giving yourself the best chance of getting a manager’s attention, says Grace Lordan.
Put your stockpicking skills to the test Turbulent markets can create opportunities for the quick-thinking investor. Pit your wits against FT journalists in our annual stockpicking contest. Be quick! Entries close at midnight GMT on Sunday, February 6.
Wellbeing and fitness
Ready to head out and socialise again? This collection of stories will help you navigate the life-long art of making friends.
Source: Economy - ft.com
